How can you identify ethically sound coffee and chocolate?

You can’t tell from your cup of coffee or hot chocolate where the beans came from. Where were the beans grown, and were they harvested, transported and processed with due respect for people and planet? In other words, how do you know which beans have the right certificates? ‘Consumers have no idea and suppliers often don’t know either,’ says Valerie Janssen, who works at Wageningen Social & Economic Research. ‘Some struggle with this ethical issue, while others simply choose the product with the lowest price and wilfully ignore the possibility of human rights abuses and environmental pollution.’ That has to change, thinks the European Parliament.

The new EU law CSDDD (the Corporate Sustainability Due Diligence Directive) was passed last year. Under the CSDDD, companies and public authorities must have a clear picture of the negative effects of their business operations on human rights and the environment. Companies then need to take appropriate measures to avoid, mitigate or end those effects. Companies will have to comply with this law from 2027. ‘The requirements are not dissimilar to the Fair Trade scheme and organic products, which also require businesses to pay more attention to people and the planet,’ says Janssen. However, while Fair Trade certification and similar schemes are voluntary, this EU law is mandatory. The Wageningen Food Views Due Diligence Dashboard is an online tool that was developed in anticipation of this new legislation. It offers an insight into what is often one of the most opaque parts of the supply chain: the primary production. 

If you are interested in the origin of cocoa beans, for example, that journey takes you to tropical Africa. ‘The main sources of cocoa beans are Côte d’Ivoire, followed by Ghana,’ says Janssen. ‘The bean is contained inside a fruit that grows on the cocoa tree. Most trees are farmed by smallholders. Suppliers often don’t know who harvested the fruits, removed the beans and prepared them for fermentation and drying. Sometimes that work is done by children, or it involves forced labour, underpayment of wages or discrimination. Working conditions for the labourers are often substandard, for example because they use pesticides or dangerous equipment without any form of protection.’ 

In Ghana, 55% of the smallholder cocoa farmers feel they have no choice but to set their children to work. That figure is almost 40% in Côte d’Ivoire. These percentages are from 2019, but Janssen says there is no reason to think the numbers have improved significantly since then. ‘So roughly speaking, half of the world’s chocolate bars are produced using child labour,’ says Janssen. 

Chocolate drinks and bars don’t come directly from the farmers; the supply chain is much longer than that. Dried cocoa beans leave the farm in large sacks. ‘From that point on, the form the supply chain takes depends on the region. The farmer might take the sacks of beans to a dealer, or a cooperative might collect the beans from several farmers. There might be intermediate dealers, but eventually the sacks are transported by ship to Europe for further processing.’

Human rights abuses are a potential risk at all stages in the supply chain. Often, there are no laws governing matters such as safety, working hours and the right of association. Or if there are, they are not enforced properly. Many countries have an official minimum wage, but it often doesn’t apply to jobs in agriculture, which only increases the risk of exploitation in this sector. These risks are relevant not just to coffee and cocoa but also to other agricultural products such as soya beans, cotton, bananas and meat.

There are also potential environmental problems in the supply chain from farm to fork, such as deforestation, loss of biodiversity, water consumption and greenhouse gas emissions. ‘The supply chain is actually bigger than that, too. For example, worker safety can also be an issue during international transport by sea or by road. Even in the countries where the produce is processed further, there are a lot of problems relating to human rights and the environment. The same types of abuses occur throughout the supply chain — it is simply that the risks are often greatest, and least transparent for suppliers, in the countries of origin.’

Companies therefore need data from the suppliers they deal with directly and indirectly, for example about the area of forest that was felled in a year, or the number of farmers whose children work on the farm. Janssen: ‘We are calculating scores per subregion to give them a helping hand.’ Scores per country aren’t enough, as there can easily be a higher proportion of cocoa farmers putting their children to work in one part of the country than in another part. Data per subregion gives a much better picture and is more useful for targeted actions.

Olam Food Ingredients (ofi) is a global supplier of coffee, cocoa, nuts, spices and dairy products. For some time now, the company has been looking for better ways to prevent human rights abuses and environmental harm. In 2021, they developed the first version of the dashboard in partnership with WUR and they now give advice on a monthly basis on the new version. This version contains data on many other regions and countries to make it relevant for other companies too. ‘We need the same understanding of risk to improve the situation in the countries our products come from,’ says Janhavi Naidu, the company’s Human Rights and Inclusion Manager. 

When you open the software tool, you will see scores for palm oil in 21 different regions in Colombia, for instance. Child labour turns out to be quite a problem in all these regions. They all score about 3.5 on a scale of 0 to 5, which is a lot, although still below the worldwide average. In comparison, it does matter where in Colombia the palms are grown for the deforestation scores, which range from 1 to 4. This allows companies to examine dozens of combinations of region, product and risk item.

A few companies are using the tool directly as a starting point for improvements. In addition, some of the scores are available through other platforms. Janssen says that means far more companies are using the scores in practice, and their number is growing. ‘Based on the scores, companies can decide to switch to a different country or region with a smaller risk of child labour or deforestation. But as researchers, we don’t encourage them to do that as it can have a big negative impact on the farmers’ survival. They don’t deliberately choose to put their children to work, for instance; they simply feel they have no alternative. The companies that sell products in Europe made from the farmers’ crops can do something about it: they can help the farmers improve the situation and put them in a position to make different choices,’ says Janssen.

At ofi, Naidu works with business teams to address human rights risks — specifically, the risks of child labour and forced labour.  ‘As per WUR's assessment, these two risks were highlighted in certain ofi supply chains, requiring the company to take further action. We are now implementing further monitoring on the ground. Thanks to WUR's sub-national risk analysis, we can now be more targeted in how and where we take up such monitoring.’

Janssen expects to be able to add more products to the dashboard before the end of 2025. Beef, pepper, nuts, maize, rice, wheat, rubber, cotton and sesame top the list, but she wants to include even more products. ‘The legislation applies to all products imported into the EU, although proposals have unfortunately been made in the European Parliament for some exceptions since the law was passed. Smaller companies may not have to comply with the rules and it is possible that not all of the supply chain will need to be transparent. We have to wait and see. If it was up to me, I’d make the law equally strict for everybody. It’s important for all suppliers to tackle the sustainability risks in their supply chains. That’s the only way to make sure we get food on our plates that was produced fairly.’